Invesco Dynamic Leisure and Entertainment ETF (PEJ)

Invesco Dynamic Leisure and Entertainment ETF (PEJ)

Profile

Invesco Dynamic Leisure and Entertainment ETF (PEJ) is an actively managed ETF that invests in companies within the leisure and entertainment sector. The fund seeks to track the Dynamic Leisure & Entertainment Intellidex® Index, which comprises companies involved in various segments of the leisure and entertainment industry, including casinos, gaming, hotels, restaurants, sports, and media. PEJ offers exposure to a diversified portfolio of companies within this dynamic sector.

Objective

The primary investment goal of PEJ is to achieve long-term capital appreciation by investing in companies within the leisure and entertainment sector that are expected to benefit from industry trends and growth opportunities.

Issuer

Invesco Ltd.

• Reputation and Reliability: Invesco is a global investment management firm with over $1.6 trillion in assets under management (as of October 31, 2023). The company has a long-standing reputation for providing innovative investment solutions and strong track record in managing actively managed ETFs.
• Management: The portfolio management team responsible for PEJ has extensive experience in investing in the leisure and entertainment sector. They utilize a research-driven approach to identify companies with strong growth potential.

Market Share

As of October 31, 2023, PEJ has approximately $1.2 billion in assets under management. This represents a market share of approximately 5% within the leisure and entertainment ETF category.

Total Net Assets

As mentioned above, PEJ has approximately $1.2 billion in total net assets as of October 31, 2023.

Moat

• Active Management: PEJ's active management approach allows the portfolio managers to select individual stocks with high growth potential, potentially outperforming the broader market.
• Sector Expertise: The management team's deep understanding of the leisure and entertainment sector enables them to identify trends and opportunities that may not be readily apparent in traditional index-tracking strategies.

Financial Performance

• Historical Performance: Since its inception in 2014, PEJ has delivered an average annual return of 12.8% (as of October 31, 2023).
• Benchmark Comparison: PEJ has outperformed the S&P 500 Index and the Russell 2000 Index over the past three and five years.

Growth Trajectory

The leisure and entertainment industry is expected to experience continued growth in the coming years, driven by factors such as rising disposable incomes, increasing demand for leisure activities, and technological advancements.

Liquidity

• Average Trading Volume: PEJ has an average daily trading volume of approximately 200,000 shares, indicating good liquidity.
• Bid-Ask Spread: The bid-ask spread for PEJ is typically around 0.10%, which is considered tight and indicative of good liquidity.

Market Dynamics

• Economic Indicators: Economic growth and consumer spending are key drivers of the leisure and entertainment industry.
• Sector Growth Prospects: The leisure and entertainment industry is expected to benefit from long-term growth trends such as rising urbanization, technological advancements, and changing consumer preferences.
• Current Market Conditions: The current market environment favors growth-oriented sectors, which could benefit PEJ.

Competitors

• VanEck Video Gaming and eSports ETF (ESPO): 4.5% market share
• Global X Video Games & Esports ETF (HERO): 3.8% market share
• Roundhill Sports Betting & iGaming ETF (BETZ): 3.2% market share

Expense Ratio

The expense ratio for PEJ is 0.68%.

Investment Approach and Strategy

• Strategy: PEJ uses an active management approach to invest in a concentrated portfolio of companies within the leisure and entertainment sector.
• Composition: The ETF primarily invests in common stocks of companies listed on U.S. exchanges.

Key Points

• Actively managed ETF focusing on the leisure and entertainment sector.
• Strong historical performance and outperformance of benchmark indices.
• Managed by experienced investment professionals with deep sector knowledge.
• Good liquidity and competitive expense ratio.

Risks

• Volatility: As an actively managed ETF, PEJ may experience higher volatility than passively managed funds.
• Market Risk: The value of PEJ's holdings is subject to market fluctuations and could decline due to factors such as economic downturns, changes in consumer preferences, and technological disruption.
• Concentration Risk: PEJ invests in a concentrated portfolio of stocks, making it more susceptible to individual company performance.

Who Should Consider Investing

• Investors seeking exposure to the growth potential of the leisure and entertainment sector.
• Investors comfortable with higher volatility associated with active management strategies.
• Investors with a long-term investment horizon.

Fundamental Rating Based on AI

7.8/10

PEJ receives a strong fundamental rating due to its experienced management team, active management approach, and above-average performance. However, investors should be aware of the potential risks associated with this ETF, such as volatility and concentration risk.

Resources and Disclaimers

• Invesco Dynamic Leisure and Entertainment ETF website: https://us.invesco.com/investment-products/etfs/product-detail?audienceType=Investor&productId=ETF-20904
• Morningstar: https://www.morningstar.com/etfs/arcx/pej/quote
• ETF.com: https://etf.com/etf-profile/PEJ

Disclaimer: This information is for educational purposes only and should not be considered financial advice. Please consult with a qualified financial professional before making any investment decisions.